IFF to Shut Down Augusta Facility - Analyst Blog
May 06 2013 - 1:20PM
Zacks
New York City-based flavors and
fragrances major, International Flavors & Fragrances
Inc. (IFF) recently announced plans to shut down the
Augusta, Georgia based Fragrances Ingredients manufacturing
facility, by July 2014.
The Fragrances Ingredients facility
forms a part of the company’s Fragrances Business Unit. In the
fourth quarter of 2012, this sub-segment grew approximately 6.0%,
year over year, on a constant currency basis. The closure of the
facility is a strategic move taken by the company in order to
implement its cost reduction measures more effectively, which was a
major driver to the increased segmental margins in the last
reported quarter.
The fragrance ingredients are used
by the company to manufacture perfumes for its own brand as well as
by its competitors. Approximately 55% of the ingredients produced
by the company are consumed internally and the balance is sold to
third-party customers.
IFF has neither assessed the
financial impact of the decision nor has it made public its plans
with respect to the workforce employed in the facility. We expect
the company to provide more details regarding the planned shut down
in its next conference call when it reports its first quarter 2013
results tomorrow, i.e. May 7, before market opens. The current
Zacks Consensus Estimate for the stock stands at $1.13 per share,
with an expected year-over-year growth rate of 13.2%.
International Flavors &
Fragrances currently has a Zacks Rank #3 (Hold). Other stocks to
watch out for in the industry are Avon Products
Inc. (AVP), Methanex Corp. (MEOH) and
Nu Skin Enterprises Inc. (NUS); each bears a Zacks
Rank #2 (Buy).
AVON PRODS INC (AVP): Free Stock Analysis Report
INTL F & F (IFF): Free Stock Analysis Report
METHANEX CORP (MEOH): Free Stock Analysis Report
NU SKIN ENTERP (NUS): Free Stock Analysis Report
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